The trial date in the United States of America v. Paul Kruse has, for a second time, been postponed. Now it is set for Nov. 8. Pre-trial work in the criminal case is getting interesting.
The 66-year old Kruse, Blue Bell’s retired CEO, is charged with six counts of conspiracy and fraud linked to a deadly 2015 listeria outbreak involving the company’s ice cream products.
Kruse is a resident of Brenham, TX, where Blue Bell Creameries is headquartered. It’s about 90 miles east of Austin.
Chris Flood and John D. Cline, defense attorneys for Kruse, have asked the federal court to issue a subpoena duces tecum to Blue Bell Creameries with a pretrial return date of June 4, 2021. A subpoena duces tecum is a type of subpoena issued by a court that requires a party to produce certain requested documents. This type of subpoena is issued before trial as parties to a lawsuit gather information to be used in evidence.
Flood and Cline, with a sign-off from the government’s attorney Matthew J. Lash, make these points:
- The indictment charges a conspiracy and substantive offenses spanning the period Feb. 13, 2015, through April 20, 2015. During roughly half that period — from mid-March 2015 through, and after, April 20, 2015 — Blue Bell management, including then-CEO Kruse, obtained and relied upon legal advice from Hogan Lovells, a global law firm with considerable expertise in FDA matters.
- Kruse intends to present evidence at trial concerning the advice Blue Bell received from Hogan Lovells. Kruse submits that this evidence is critical to his defense because it will tend to negate the intent to defraud that is an element of each of the charges against him.
- During the investigative stage of this case, Blue Bell withheld most, if not all, communications between Hogan Lovells and Blue Bell management during the mid-March 2015 through April 20, 2015, period based on the attorney-client privilege and the attorney work-product doctrine. Blue Bell, through counsel, has similarly declined to provide documents reflecting those communications to Kruse or his counsel. Kruse, therefore, intends to subpoena the documents.
- The attorneys expect Blue Bell to move to quash the subpoena based on the attorney-client privilege, the attorney work-product doctrine, and perhaps other grounds. Blue Bell’s anticipated motion to quash will likely require the Court to determine, among other potential issues, whether the attorney-client privilege and the attorney work-product doctrine are properly asserted, whether the protections of those privileges have been waived or otherwise lost, and whether Kruse’s Fifth and Sixth Amendment rights to compel the production of evidence for his defense overcomes any valid privilege Blue Bell asserts for the documents. These are complex issues that will require thorough briefing and, potentially, in camera review of the subpoenaed documents by the court.
- Rule 17(c)(1) authorizes the court to “direct the witness to produce the designated items in court before trial or before they are to be offered in evidence.” To ensure adequate time before trial to litigate the issues outlined above and for the parties to review any documents the court orders produced, Kruse asks that the court authorize him to set a pretrial return date of June 4, 2021. If the court authorizes the pretrial return date, Kruse will serve the subpoena promptly on Blue Bell.
- Matthew J. Lash, Assistant Director of the Consumer Protection Branch of the Civil Division of the Department of Justice, has advised undersigned counsel that the United States does not oppose Kruse’s request for a pretrial return date for Rule 17(c) subpoena to Blue Bell. The United States takes no position at this time on the merits of the subpoena or any motion to quash.
- For the foregoing reasons, Kruse asked the court to authorize him to set a pretrial return date of June 4, 2021, for this Rule 17(c) subpoena to Blue Bell.
In May 2020, the company pleaded guilty to two counts of distributing adulterated food products in violation of the Federal Food, Drug, and Cosmetic Act.
The subpoena duces tecum to Blue Bell is not the only pre-trial business that could get complicated. It expects to issue “one or more” to third parties.
And lawyers for the defense and the government say the pre-trial is going to include “voluminous and ongoing discovery, the need to retain experts and — potentially — litigate the scope of their testimony and the possibility of motion practice involving Rule 17(c) subpoenas.”
Discovery has so far produced 880,000 pages of material, including 58,800 pages that the government turned over to the defense as recently as Feb. 21.
Both sides anticipate using third-party experts at trial, which could require so-called Daubert hearings on the admissibility of such expert witness testimony. Such hearings can be held before and during trial.
The jury trial was to have started on July 26, 2021. However, U.S. District Court Judge Robert Pitman signed off on the latest delay. He found the additional time is in the best interest of both the public and the defendant.
The defense and the government have agreed to jointly work on filling out the calendar for pre-trial motions, disclosures by the prosecution and defense, proposed jury instructions, jury selection questions, and other pretrial matters.
It will be somewhat ironic if Blue Bell is drawn back into the case via the subpoena duces tecum. It paid $19.35 million in fines, forfeiture, and civil settlement payments — the second-largest amount ever paid in resolution of a food safety matter — to put the matter behind the company once and for all.
The company pleaded guilty in a related case in May to two counts of distributing adulterated food products in violation of the Federal Food, Drug, and Cosmetic Act. It agreed to pay criminal penalties totaling $17.5 million and $2.1 million to resolve False Claims Act allegations regarding ice cream products manufactured under unsanitary conditions and sold to federal facilities, including the military.
Charges against Blue Bell, and separately against Kruse, are associated with a 2015 listeria outbreak, in which Blue Bell brand products were the source. A total of 10 people with listeriosis related to the outbreak were reported from four states: Arizona with 1, Kansas with 5, Oklahoma with 1, and Texas with 3.
All were hospitalized and three from Kansas died.
On April 20, 2015, Blue Bell Creameries voluntarily recalled all of its products on the market at that point that had made at all of its facilities, including ice cream, frozen yogurt, sherbet and frozen snacks. It also closed its production facilities in four states.
The U.S. Food and Drug Administration released the critical findings from recent inspections at the Blue Bell production facilities on May 7, 2015.
Listeriosis is a life-threatening infection caused by eating food contaminated with the bacterium, commonly referred to as a germ, Listeria monocytogenes. People at high risk for listeriosis include pregnant women and newborns, adults 65 and older, and people with weakened immune systems.